Tuesday, February 3, 2009

NEWS ALERT

from The Wall Street Journal

Feb. 3, 2009

Citigroup is exploring the possibility of backing out of a nearly $400 million marketing deal with the New York Mets, say people familiar with the matter. Officials at Citigroup have made no final decision about whether to try to void the 20-year agreement, which includes naming the Mets' new baseball stadium after the bank, say these people. In a statement Monday, Citigroup said that "no TARP capital will be used" for the stadium -- referring to government funds from the Troubled Asset Relief Program. But as it revisits the pact, Citigroup is essentially acknowledging that the volatile political climate could make it untenable for the bank to proceed with the deal.

The camel’s nose is in the tent. The TARP and whatever turns out to be Son of TARP have put our feet on “the road to serfdom.” This is how it begins. This slope isn’t just slippery; it’s a near vertical sheet of ice.

Incidentally, since money is fungible, TARP capital will certainly be used for any and all expenditures made by Citigroup, including the Met’s stadium deal.